Author Archives: Carol Jones

B&B Refinance from Residential to Commercial Mortgage

The Old Mill, Bere Regis

David & Lorna have, very successfully, owned and operated, The Old Mill B&B in the lovely Dorset village of Bere Regis. They originally purchased the property as a residential property and the B&B evolved over time, however, over the last couple of years they became aware that instead of a residential mortgage they should have had a commercial mortgage as they were trading as a B&B.

David & Lorna spent some time looking at their options and eventually decided to engage Stewart Hindley & Partners to look at the finance options available to them and to arrange the refinance. Luckily the business had a good level of turnover and the net profit was sufficient to support the required debt service cover. This is not always the case when people trade on a residential mortgage and the consequences can be serious. If you would like to know more about this check out our article on “Are you Risking your B&B

The location of The Old Mill was also a bonus in that it is close to the Jurassic Coast, Monkey World and The Tank Museum which are all popular Dorset visitor attractions.

Needless to say we have successfully remortgaged the property and have given David & Lorna the security of knowing that they are not breaching any mortgage covenants and have the best possible deal available to them.

Check out the website for The Old Mill

What David & Lorna say about working with Stewart Hindley & Partners….

With our circumstances having changed since we originally purchased our property it was clear that we would have to make the transition from a residential mortgage to a commercial mortgage.

We approached a few brokers to undertake the job of finding us a suitable lender that would work with us and our B&B business. In the end it was a simple decision to instruct Stewart Hindley & Partners.

They took on the task of compiling sound evidence that our business was a profitable and sound concern before approaching potential lenders.

This was all completed in a timely and uncomplicated fashion and would highly recommend Stewart Hindley & Partners to anyone thinking of financing a B&B operation either as a start up or a going concern.

 Many Thanks indeed

 David & Lorna Ventham – The Old Mill

New owners at Ellinbrook Guest House – Hunstanton

Richard and Nicola had been letting out Daisy’s Cottage in Wells next the Sea and decided that they wanted to take their letting to the next level so started to search for a suitable bed and breakfast property in Norfolk.

They found Ellinbrook House in the popular coastal town of Hunstanton. It wasn’t until they started to look at funding options they decided that the best course of action was to engage a specialist broker to help them secure the best possible deal given their personal circumstances. Richard contacted us here at Stewart Hindley & Partners and the journey began in earnest.

We liaised with a number of lenders, not all of whom were interested in funding the deal, however we did manage to secure them the required amount of funding to enable them to purchase their new venture. To help minimise the lenders risk Nicola will continue to work in her current employment on a work from home basis and will be on hand to help Richard with changeovers and busy periods.

The lenders see a background income as reducing their lending risk but it is not taken into account when looking at the lending requirements, the business must be able to support the debt service or at least have the potential to do so. You should always bear this in mind when you are looking to buy a B&B.

Even though Richard and Nicola had been letting out their holiday cottage for a number of years they were still considered as “New to Trade” by all the lenders. It has taken a bit longer than initially assumed but they have now finalised the lending and will be open for business from September 2019. So, if you want to have a relaxing stay on the Norfolk coast why not check them out at Ellinbrook House

What Richard & Nicola say about Stewart Hindley & Partners……

When the opportunity came up to purchase Ellinbrook House we knew we would need assistance from a specialist broker to help secure the funding we would require. We spoke to a couple of firms but were struck with how professional Chris was and how well he explained the whole process to us.

Despite a couple of setbacks along the way Chris and Carol worked tirelessly to secure us the funding required, I don’t think there would have been any way for us to have secured it without Chris and Carol’s help. We are now up and running and loving it!

Thanks for all your help, Richard & Nicola

Ellinbrook House 

Thinking of Selling your Hotel?

Thinking of Selling Your Hotel? Here’s How to Know it’s the Right Time

As an established hotel owner, you may perhaps have entertained the idea of selling your business. You may understand that timing plays a part in such decisions. But is now the best time? And how will you even know when that ‘best time’ actually comes around? It’s rarely an easy call to make, so here’s a few things you should consider.

Reasons for selling

Sometimes you may just have to accept the fact that you can’t really control your need to sell. Other aspects of life which cannot be put off may simply intervene. You, or your partner, may be suffering poor health, or you may have to face divorce or some other family crisis. Equally, you may be fast approaching retirement, or have been presented with some need to liquidate your assets which must take priority over your business responsibilities.

More often, as a hotelier, you may notice a relentless downward spiral in profitability. Whilst some owners catch the problem early and are able to take remedial measures, others may find things have gone far beyond any hope of retrieving the situation.

If your accommodation business is performing poorly with little hope of an upturn, then taking the decision to sell may be your best chance of selling at an acceptable price. In such unfortunate circumstances it may be best to salvage what you can rather than risk a further decline.

On the other hand, some hotel owners may recognise that their soundly performing business is presenting them with a golden opportunity to sell on their own terms. A business with a good track record will usually sell for a better price, and often sells far more quickly too. And this is especially so where the owner can show that profits are on a sustained upward trajectory.

Research the market

To determine your sale prospects, or even simply to optimise the outcome once you are nearly ready to commit, it will always pay to carefully research the market. Whilst that is likely to involve seeking professional opinions, it should also involve a thorough personal investigation. It’s only by immersing yourself in such detail that you can get a proper ‘feel’ for market conditions.

For instance: Are local sector trends a reflection of regional market conditions? Or are there local factors which are exerting a stronger influence? And considering the national picture: What do the long-term sale statistics say about the future prospects for the hotel industry? And what seems to be the optimum time of year for selling with a view to securing the best return on your investment?

The hotel industry is one that fluctuates and so you will need to keep a careful eye on what the future trends are. There are three main factors that will impact the value of your hotel: the profit that your business is making, what multiple of the profits the buyer is willing to pay and the condition of the business. Make sure that you are in a positive position with all three of these factors where possible if you want to make a good return on your investment.

Threats and opportunities

You may know some local owners are about to retire and close down, or be aware of plans for major leisure and tourist developments about to occur in your area. Indeed, such information may be just what you need to hear to give you an ideal chance to present your business as being rich in potential.

Or alternatively, you may have been advised that a national hotel chain has earmarked your town as a likely location for expansion, or perhaps you have lost some of your best staff who have proved well-nigh impossible to replace.

Whatever the scenario, if a hotel sale could be on the horizon, you must remain alert to how such developments could affect your prospects.

You should also identify whether there are areas where your business could expand in the future so that buyers can be promised the chance for expansion. Is there is the potential for more rooms to be added? Could a restaurant or spa be included as part of the business?

Assess what pre-sale preparation is required?

If you can afford to sell when you’re ready, you should also consider what pre-sale preparation will be necessary to get your business up to the mark in order to prepare for a listing. If you have a well-run hotel in good health with strong bookings, perhaps also supported by strong local patronage, you must also have the evidence to prove the worth of your business.

One extremely important element here is your business paperwork, which must be in excellent order. Any serious buyer will never take your word alone. They will wish to see historical evidence of your trading revenues, and much else besides.

Have clear documentation of the occupation rates and how this fluctuates during the year. You will also need to do an audit of the stock that will included at the time of handover of the hotel.

In addition to exemplary paperwork, your premises should be in good repair and decorated to a good standard throughout. But beyond maintenance, and just as important, you should ensure your hotel is equipped in a way which reflects the latest industry trends and emerging technologies.

This extends beyond micro-details such as contemporary coffee facilities in your rooms, and should certainly include an overhaul of your (hopefully) mobile-friendly hotel website as well as your booking systems and digital marketing strategy.

By Matthew Hernon is an Account Manager at Dynamis looking after Business Transfer Agents and Franchises across BusinessesForSale.com and FranchiseSales.com.

4 Tips for Appliance Safety in Your B&B

Beckie Hatton is a Product Manager at Home Appliance Care, so she understands exactly how important it is to have safe and efficient electrical appliances. Here, she offers her advice to B&B owners who want to follow the rules and keep guests safe.

All B&B owners have a legal responsibility to safeguard the public and their employees from harm (legislation.gov.uk). More specifically, you must make sure your electrical appliances are well-maintained and fit for purpose to prevent fires, gas leaks, electric shocks, and other disasters.

Small hospitality businesses that fail in their legal obligations can face serious consequences, from penalties and lawsuits to property damage and fatalities. So, it’s important to stay on top of maintaining the electrical appliances in your kitchen, guest rooms, and communal areas to keep your guests safe.

Below, I’ll be sharing some of my tips for making sure the appliances in your B&B are safe to use.

Which appliances to check

Any utensils and appliances that are battery operated or can be plugged into the mains must be well maintained and regularly reviewed. You should check them for signs or wear or damage at least once every month as part of your fire risk assessment (gov.uk), and they will have to be serviced or PAT tested every 6-12 months to be declared fit for use (pat.org.uk).

When you first think about which appliances in your B&B could be considered high-risk, most people rightly think of ovens, toasters and straighteners that are designed to heat up. But washing machines and tumble dryers account for more than a third of domestic fires, significantly more than cookers (11%), so it’s crucial that you keep on top of the maintenance of these appliances in particular (Which?).

Should I call an engineer?

You should contact an electrical engineer if you have any concerns about the internal wiring of your appliances rather than attempt to fix them yourself. Tampering with electrical systems can cause injuries or fatalities, and if you don’t have the right tools or knowledge you could put yourself and everyone else on the premises at risk.

Plus, tampering with your appliances usually voids their warranty and your insurance policy, so you’ll have to cover the cost of repairing and replacing any damaged machines. It’s safer and cheaper overall to let the professionals deal with it instead.

Common faults to watch out for

External issues like loose plugs, switches and outlets can often be amended by a quick screw retightening, and you can also replace any broken casings yourself using just basic tools and knowledge — but you must switch off and unplug everything first so there’s no electrical current.

If you notice your plugs, outlets and switches are getting warm, it could be a wiring issue that can cause a fire if not immediately fixed. In this case, these will need to be repaired or replaced as soon as possible and you should not attempt to use the appliance while you wait for the electrician.

Flickering lights or displays on your appliances, as well as your bulbs burning out too quickly, can be indicators that there is a loose connection somewhere inside the machine. If you notice any of these problems, you should stop using the appliance and call a professional immediately.

How to look after your appliances

Never skip your monthly fire risk assessments, annual services, or scheduled PAT tests. Fires and other electrical dangers don’t just happen as the result of faulty products — appliances that aren’t properly maintained pose a risk too. Failing to clean them properly, check them over regularly, and take care of small problems can lead to huge disasters, so you must have adequate maintenance strategies in place to tackle all these issues.

Encourage your kitchen staff to clean appliances at the beginning and end of each day to prevent build ups of food crumbs, grease and other debris — just be sure that they follow the manufacturer’s instructions for doing this safely. Cleaning in a way the manual suggests will also protect your appliances from corrosive damage which can lead to electrical issues, such as loose wiring. So, hang onto your user manuals and double check all their cleaning practices are compliant with the manufacturer’s suggestions.

These are just some of the ways you can make sure the appliances in your B&B are as safe as possible. By giving them a quick look over as often as you can and promptly reporting any issues to an electrician, your appliances can be safe for use and you can get on with managing your guesthouse.

Isles of Scilly Bed & Breakfast

The dream – A Bed and Breakfast on The Isles of Scilly – it came true!

Kelly and Kevin had a dream of owning their own bed and breakfast in the Isle of Scilly and weren’t sure it would be a possibility. They knew the town of St Mary’s well and when they found their perfect property there they couldn’t believe their luck.  They contacted us to see what they could borrow and if it was possible for them to sell up on mainland UK and move over.  Well, they have done it with the help of us here at Stewart Hindley & Partners!

The first step was for Kelly to send us the property details and accounts for the business they wanted to buy and we then helped them by assessing how fundable the deal would be.

Crebinick House was a traditional Grade II listed building which had been extended at the rear to provide a large 9 bedrooms property consisting of 6 spacious guest rooms and 3 bedroomed owners’ accommodation.  The guest house was well established and had a number of returning guests as well as excellent online reviews.

The only downside was that there had not been a focus on trade for a couple of years due to the current owners’ ill health and pending retirement. This meant the deal would be reliant on projections which always makes the deal a bit more of a challenge.  Lenders tend to look at projection led deals as more high risk and are slightly more reluctant to lend on them.

Because Stewart Hindley & Partners specialise in the hospitality sector we understand what are standard and achievable costs for a bed and breakfast or guest house.  We are able to provide lenders with realistic projections which show that the business is capable of building the trade and, importantly, can cover the debt service going forward.

We submitted the deal and after a bank meeting and acceptable valuation report the deal was offered.  Kelly and Kevin completed their purchase and started living the dream in February 2019.

There is a lot going on in the Isles of Scilly so if you are visiting why not stay at Crebinick House where you are assured of a warm welcome.

https://www.crebinick.co.uk

What Kelly and Kevin say about us…..

We fell in love with Crebinick at first sight and desperately wanted to make it our home and business.  After a depressing conversation with a business manager at a local bank, due to the previous few years’ deliberately low trading figures, it seemed we would need professional help to persuade a lender of the potential of the business in order to get our dream off the ground.  Stewart Hindley had a great reputation for assisting in situations such as ours and from our first conversation with Chris we were filled with hope that a lender might believe in Crebinick as we did.  Chris’ experience ensured that he approached the right lender for us with the right information and ultimately we were successful in getting the finance we needed.  We don’t think we could have managed it without Stewart Hindley or, at least, certainly not in time to begin the 2019 season as we have done!  Thanks for all your help.  

Kelly & Kevin

Crebinick

Love Whisky? You will love The Gables B&B

Bed & Breakfast for the Whisky Lover!

Our clients Siebette and Anne-Jan contacted us in May 2018 to ask about hospitality finance as they were looking at moving from Holland to Scotland to fulfill their dream of owning and operating a whisky themed bed and breakfast.  Both of them have an in depth knowledge of the Whisky industry and have their own impressive collection from which they offer tasting sessions!

After much searching they found The Gables in Dufftown a perfect location as it is on the famous Whisky Trail.  The Gables was an established bed and breakfast but was traded very much to suit the owners so there was no focused effort on the trade which meant limited accounts and made the deal just that little bit more challenging.  We were able to position the deal showing realistic and achievable projections for when Siebette and Anne-Jan took over.

The process of the loan application went through fairly seamlessly, however, there were some issues during the legal work stage and these have caused some major delays.  The loan was offered in September and instead of being able to complete and move in at the beginning of December, which would have timed well with their house sale and move from The Netherlands, they have had to wait until February 2019 for the legal paperwork to be sorted out.  This obviously caused some major stress not least because they were moving country as well (as home) and they were also ready to go with a new website and links to the distilleries in the area – it seemed it was all systems go!  It was a very frustrating time.  Stewart Hindley & Partners tried to assist them by continuing to engage with the lender and suggesting ways that things could move forward.  Eventually the dream came true and they became the owners of The Gables on 30 April 2019!

To cut a long story short, they are now trading well and offer their guests themed packages such as:-

  • Whisky & Chocolate
  • Whisky & Cigars
  • Whisky & Cheese
  • Don’t Drink & Drive Whisky Tours

In addition to the Whisky there are a host of other things to do in the area, Walking, Skiing, Fishing and Golf to name a few.  Why not visit their website to find out more….

https://www.thegablesbb.co.uk/

https://www.facebook.com/thegableswhiskybb/

What Siebette and Anne Jan say about Stewart Hindley & Partners…

It has been our dream for years to run a whisky themed B&B in Speyside/Moray. All though we did a lot of research ourselves and developed the outline of a business plan, it was difficult for us – being Dutch and without experience in starting a hospitality business – to come up with the necessary figures and obtain funding. We almost give up on our dream when we heard of Stewart Hindley and contacted them. They reviewed our ideas and financial situation and advised our dream was possible. They helped us with our business plan and knew which lenders to approach. They supported us at every step in the process, both with their extensive expertise and – equally important – mental support. We could trouble them with any question we had, answers were always provided quickly and in a way we exactly understood what was going on. After obtaining the commercial mortgage there were problems in the conveyancing of the property we had set our eyes on. All though beyond the scope of their service Stewart Hindley kept in touch with us and relevant parties, they did everything they could to help us to get this sorted. And in the end, all came right and we are now the proud owners of The Gables Whisky B&B. Carol, thank you so much for everything, we could not have realised our dream without you!

Kind regards,

Anne Jan & Siebette

The Coach @ Edenfield – Great Gastro Pub

Our client wanted a quick purchase when he found the Coach at Edenfield and decided using an experienced hospitality broker was the way to get the best rates and the required amount of funding.

Dan was an experienced Bar/Manager who had a wealth of diverse bar trade experience.  It was his dream to own his own destination venue pub.  He found the property he wanted but needed to move fast.  We worked with Dan to provide a loan proposal which met the lenders criteria and showed his experience, the potential of the business and plans for the future.

The process was helped by the fact that Dan provided all the information we required promptly, in usable formats and was available to meet with the lender at short notice.  The whole process took 6 weeks from start to finish which is an exceptionally quick time and included having to get the valuation report carried out and produced.

Located on the outskirts of Ramsbottom, in the village of Edenfield, The Coach is the perfect place in which to socialise and relax with friends and family. A warm,  comfortable and welcoming pub with a menu that mixes up the traditional and the slightly more progressive with dishes of real ambition – served by a young and attentive team. Why not book a table and see for yourself.

https://thecoachatedenfield.com/

What Dan says about Stewart Hindley & Partners..

I was recommended Stewart Hindley as I was told that they specialise in obtaining debt for the hospitality sector. Upon speaking to Chris for the first time I was told that they would do everything they could to obtain the loan to value ratio that I requested. It took no time at all for a suitable creditor to be found and, with an incredible short time-frame to work with, Chris was able to get everything across the line in time for me to start trading by Christmas 2018.

I can’t recommend their team highly enough!

Betws-y-Coed in North Wales – It took a while but they got there!

It was 2016 when Gidon and Izabela first contacted us to discuss bed and breakfast finance. They had attended a bed and breakfast course run by Karen Thorne at Hopton House in Shropshire and had decided to buy a bed and breakfast in the Shropshire area.  Unfortunately it took a while for them to sell their property and the original concern they were interested in was snapped up by another buyer.

Eventually they found a buyer and started looking again in earnest, however, this time they focused on the Lake District and North Wales (both excellent and beautiful locations!).  After a few disappointing starts they settled on Afon View in Betws-y-Coed, North Wales and their dream really started to materialise.  They completed their purchase and moved into Afon View in December 2018!

Afon View has 7 lovely letting rooms and guests are sure of a warm welcome from Gidon and Izabela.

Afon View is located in a village that attracts outdoor enthusiasts from around the world and is one of the main places to stay in Snowdonia.  Whether you are a walker, climber, kayaker, cyclist  or angler there are loads of places to visit and things to do in the area.

https://www.afon-view.co.uk/

North Devon Bed and Breakfast

Vanessa & Phillip Moyle had previously let out just one room of their house in Salcombe in South Devon and after some time decided that they wanted to use their love of meeting people and their hospitality skills to develop a business in the popular North Devon coastal village of Lynton.

They spent some time looking for the right property and eventually settled on a 4* guest house, Rockvale House.  Rockvale House had been owned for a number of years by the same people and was traded very much to suit their personal requirements.  This presented a great opportunity for Vanessa & Phillip to purchase a well-established 8 bedroomed Guest House located in the heart of Lynton and within the Exmoor National Park with great views.

As the concern had been traded for just 6 months of the year and often closed during peak times the accounts did not reflect the true potential of the business which can make it a challenge to fund from a lenders point of view.  As we, Stewart Hindley & Partners, are specialists in hospitality finance we were able to present a solid case to the lender with achievable goals and projections showing that debt service could be met.

Vanessa and Phillip completed on their purchase in December 2018 and are now looking forward to operating the business on a year round basis and sharing the beauty of North Devon and Exmoor with their guests and, of course, meeting lots of new and interesting people along the way!

If you are looking for a warm welcome, comfortable stay and panoramic views  why not choose Rockvale House on your next visit to the area!

https://rockvalelynton.com/

What Vanessa & Phillip say about Stewart Hindley & Partners….

From the first moment we contacted Stewart Hindley & Partners and spoke to Carol and then Mike Cox they could not have been more helpful, they were straight on the case working at such a speed it was brilliant.  Mike took away so much pressure and stress normally associated with a purchase like this, he spoke to us in such an open and honest way it was really refreshing.  His professionalism was superb and we are very grateful to him.  We know Carol did so much behind the scenes too.  We have no hesitation in recommending Mike Cox at Stewart Hindley & Partners 100 per cent. 

Thank you

Ness and Phil, Rockvale House

 

Cambridge Bed & Breakfast (formerly Harry’s B&B)

Selma & Anel Begic started talking with us in April 2018 when they were looking for a suitable bed and breakfast to purchase.  They eventually found one in June and instructed us to work with them to purchase the concern in July.

The bed and breakfast was well established and had been operated by the same owner for a number of years.  It was ready for some refurbishment which meant that Selma and Anel had the perfect opportunity to purchase a popular B&B in a prime location and which had room for improvement and business development.

The whole process proceeded reasonably smoothly with us supporting and guiding Selma and Anel through all the different stages and they completed their purchase in October 2018.  They have renamed Harry’s B&B and it is now called Cambridge Bed and Breakfast.

The location of the Bed and Breakfast is ideal for visitors to the Cambridge Business Park, most of the colleges of Cambridge University and is just 5 mins away from the river Cam and Jesus Green park, through which you can take a scenic walk to the beautiful town centre.  So, wherever you want to visit in Cambridge it is an ideal place to stay in.

www.cambridgebedandbreakfast.co.uk

What Selma & Anel say about Stewart Hindley & Partners….

I would absolutely recommend Stewart Hindley’s expertise in commercial mortgages. 

Mike Cox was excellent in keeping the process rolling and being professional even in difficult times. The rates offered saved me money in the long run, exactly what we needed with a new business. 

Mikes help with the business plan and the banking interview process was invaluable. 

Thank you for all the help and support!